博鱼体育集团

The best way to describe the recent performance of the UK property market is 鈥榯en weeks of recovery followed by ten weeks of drift鈥�.

It is a pattern shaped by interest rate expectations, with mortgage costs dipping and rising as signals around inflation have been frustratingly mixed.

The result is a lack of urgency among buyers, a fact compounded by rising supply. The number of sales instructions in London was 17% above the five-year average in the first quarter of 2024.

This mood of circumspection means needs-based buyers are currently playing a bigger role in driving activity. 

While this has benefitted lower-value markets, where a higher proportion of domestic buyers move for education or employment, there has been more hesitancy in discretionary, higher-value markets. Uncertainty around recent rule changes for individuals with non-dom tax status may have aggravated the situation.

For overall momentum to grow, a bank rate cut needs to feel much more imminent. After hovering above 4% since the start of February, a five-year swap rate starting with a 鈥�3鈥� would provide a boost for lenders and borrowers.

For now, the evidence from the first quarter of this year only highlights the difference between higher and lower-value markets.

The number of new prospective buyers between £750,000 and £2 million was 21% above the five-year in the first three months of year, 博鱼体育集团 Frank data shows. Above £5 million, the increase was just 3%.

Meanwhile, the total number of offers made between £750,000 and £2 million was 6% higher, while above £5 million there was a 6% decline.

A comparison between south-west London (where demand is typically more needs-driven) and prime central London (PCL) paints a similar picture, as the graph shows.

The number of new prospective buyers, offers made and exchanges have all been notably higher in the south-west of the capital over the last six months.

鈥淭here is strong buyer demand and lots of new instructions are getting agreed,鈥� said Luke Ellwood, head of south-west London sales at 博鱼体育集团 Frank. 鈥淭he number of properties under offer has grown sharply in recent weeks.鈥�

Indeed, the two London areas with the strongest price growth in the year to March were Wandsworth (+2.6%) and Dulwich (+2.3%).

Furthermore, while the average price change for all flats in prime central London was -2.9%, the equivalent decrease for houses in prime outer London (POL) was -0.2%.

Overall, average prices in PCL fell 2.4% in the year to March, the same figure as recorded in February. Meanwhile, prices were down by 1.5% in POL after rising by 0.1% on the previous month.